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Otley sets sights on AM100 with 'no frills' expansion

A Yorkshire-based 'no frills' retailer is planning a dramatic entrance to the exclusive AM100 club next year as it bids to treble its turnover.

Otley Motors, which has increased turnover from £6m to £30m in five years, says the success of its retail concept can propel the group past the £100m mark. The company, which promotes itself as the EasyJet of the automotive retail sector, operates a tightly controlled selling system said to convert one in two prospects.

Customers are greeted on arrival and given a booking to test-drive a vehicle. When they return from the drive, they are automatically channelled into an office with a salesperson.

Among the no frills initiatives enabling the group to save cash and offer low labour rates are courtesy cars hired out from £5 a day and car mats not supplied free with new or used vehicles.

Cars are sold with free 28-day warranties with cost-extra options of extending. Buyers are offered free MoT testing for the life of the car and service and repair work on the vehicle's first test is provided at no charge. Otley says the MoT scheme retains customers and significantly improves aftersales performance.

Currently, the company has three sites – Ford solus outlets in Otley and Bingley and a used car supermarket in Ackrington. It hopes to acquire two single-point sites capable of selling at least 1000 cars a year each in the next 18 months.

The M62/A59 corridor has been earmarked for expansion with the company considering sites in Burnley and Colne in Lancashire, and Keighley in West Yorkshire. Combined new and used car sales for the group stand at 4500 units but Otley intends to be retailing 14,000 units in five years' time. John Graham, chairman and managing director, says: “There is a place in the market for customers who want to buy a good quality product at a low price without the frills. If we have another £20m on our bottom line in 18 months then we can achieve our goal. “The changes to block exemption mean there will be a lot of auto-motive businesses for sale. For the first time the franchise owner, rather than the vehicle manufacturer, will control the goodwill of their business.”

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